The Cato Corporation (CATO)
NYSE:CATO
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The Cato
(NYSE:CATO)
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Rating:42Neutral
Price Target:
$3.00
▼(-14.04% Downside)
Action:ReiteratedDate:03/29/26
The score is primarily pressured by weakening financial performance (declining revenue, ongoing losses, and negative free cash flow). Technicals add further downside risk with a clear downtrend (price below key moving averages and negative MACD). Valuation is constrained by negative earnings and no dividend yield data to provide support.
Positive Factors
Moderate leverage
Leverage just under 1x equity gives the company more financial flexibility than highly leveraged peers, lowering immediate solvency risk while it works to restore profitability. That structural headroom supports refinancing or strategic investment over the next several months if operations stabilize.
Negative Factors
Multi-year revenue decline
Sustained top-line contraction erodes operating leverage and makes fixed-cost absorption harder, pressuring margins and cash flow. A sharp 2026 drop suggests structural demand or footprint issues that will require substantive strategic changes to reverse, increasing medium-term execution risk.
Read all positive and negative factors
Positive Factors
Negative Factors
Moderate leverage
Leverage just under 1x equity gives the company more financial flexibility than highly leveraged peers, lowering immediate solvency risk while it works to restore profitability. That structural headroom supports refinancing or strategic investment over the next several months if operations stabilize.
Read all positive factors
The Cato (CATO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$59.22M
Dividend YieldN/A
Average Volume (3M)57.80K
Price to Earnings (P/E)―
Beta (1Y)0.74
Revenue Growth0.62%
EPS Growth68.32%
CountryUS
Employees7,000
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Retail
Share Statistics
EPS (TTM)-0.29
Shares Outstanding17,910,433
10 Day Avg. Volume67,079
30 Day Avg. Volume57,801
Financial Highlights & Ratios
PEG Ratio0.14
Price to Book (P/B)0.37
Price to Sales (P/S)0.09
P/FCF Ratio-11.13
Enterprise Value/Market Cap3.08
Enterprise Value/Revenue0.28
Enterprise Value/Gross Profit0.86
Enterprise Value/Ebitda317.51
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
The Cato Business Overview & Revenue Model
Company Description
The Cato Corporation, together with its subsidiaries, operates as a specialty retailer of fashion apparel and accessories primarily in the southeastern United States. It operates through two segments, Retail and Credit. The company's stores and e-...
How the Company Makes Money
null...
The Cato Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
52
Neutral
Cash Flow
29
Negative
| Breakdown | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 653.81M | 649.81M | 708.06M | 759.26M | 769.27M |
| Gross Profit | 212.28M | 203.55M | 233.88M | 238.52M | 303.85M |
| EBITDA | -4.20M | -6.24M | -3.90M | 12.94M | 51.39M |
| Net Income | -5.91M | -18.61M | -22.59M | 41.00K | 34.91M |
Balance Sheet | |||||
| Total Assets | 421.42M | 452.36M | 486.82M | 553.14M | 633.77M |
| Cash, Cash Equivalents and Short-Term Investments | 76.32M | 77.70M | 102.95M | 128.66M | 165.76M |
| Total Debt | 150.45M | 145.90M | 153.12M | 174.77M | 184.33M |
| Total Liabilities | 264.11M | 290.06M | 294.50M | 326.55M | 379.57M |
| Stockholders Equity | 157.31M | 162.30M | 192.32M | 226.59M | 254.20M |
Cash Flow | |||||
| Free Cash Flow | -5.22M | -27.62M | -12.05M | -6.06M | 55.68M |
| Operating Cash Flow | -1.46M | -19.75M | 477.00K | 13.37M | 59.79M |
| Investing Cash Flow | -1.30M | 28.96M | 19.78M | 16.02M | -25.33M |
| Financing Cash Flow | -851.00K | -14.05M | -16.13M | -29.28M | -31.80M |
The Cato Technical Analysis
Negative
3.49
Price Trends
2.97
Negative
3.12
Negative
3.40
Negative
Market Momentum
-0.01
Negative
42.66
Neutral
41.13
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CATO, the sentiment is Negative. The current price of 3.49 is above the 20-day moving average (MA) of 2.88, above the 50-day MA of 2.97, and above the 200-day MA of 3.40, indicating a bearish trend. The MACD of -0.01 indicates Negative momentum. The RSI at 42.66 is Neutral, neither overbought nor oversold. The STOCH value of 41.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CATO.
The Cato Risk Analysis
The Cato disclosed 28 risk factors in its most recent earnings report. The Cato reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
The Cato Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $126.21M | 2.68 | -9.82% | ― | -9.81% | 64.57% | |
51 Neutral | $105.25M | 3.76 | -21.26% | ― | -2.79% | 62.29% | |
51 Neutral | $159.08M | -15.08 | -17.71% | ― | 7.71% | ― | |
49 Neutral | $34.44M | -0.32 | -27.26% | ― | -6.85% | -1411.16% | |
46 Neutral | $28.23M | -28,714.66 | -326.53% | ― | -10.64% | 75.40% | |
42 Neutral | $59.22M | -1.39 | -3.88% | ― | 0.62% | 68.32% |
* Consumer Cyclical Sector Average
CATO
The Cato
2.88
0.59
25.76%
TLYS
Tilly's
4.24
2.99
239.20%
DXLG
Destination XL
0.66
-0.33
-33.30%
DLTH
Duluth Holdings
3.27
1.46
80.66%
RENT
Rent the Runway
4.82
1.32
37.71%
LVLU
Lulu's Fashion Lounge Holdings
10.30
4.02
64.01%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.